6d • General discussion
Q: I would like to buy a multi-unit that has 5 units and higher. Should I?
A: I would vote against it. The main driver for the performance of Single Family Homes over the long-term is the astounding 30-year FIXED rate loan. We talk about it all the time. The 30-year fixed rate loan is only given to “1 to 4 residential units”. That means, single family homes, duplexes, triplexes and fourplexes. The minute you buy “5 and over”, you will get commercial loans, which may carry pre-payment penalties in the form of defeasance or yield-maintenance, are likely not to be fixed for 30 years, and may require on-going information on the property performance given to the lender. That is a whole other ball game. I would stick to Single Family homes (or duplexes in GOOD areas).
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Q: I would like to buy a multi-unit that has 5 units and higher. Should I?
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